Nvidia stock slips on China trade fears

Published On Sep 30, 2024, 10:14 AM

Nvidia's stock fell approximately 2.8% in premarket trading due to news that Chinese regulators are advising local companies to avoid purchasing Nvidia's AI chips, instead encouraging them to source from domestic manufacturers amid ongoing trade tensions with the U.S. Nvidia has previously responded to these tensions by attempting to develop compliant chip variants for China. Despite this setback, Nvidia's sales in China showed signs of recovery, with a reported revenue of about $3.7 billion in the last quarter. Analysts remain optimistic about Nvidia's future prospects, with the majority recommending to buy the stock, anticipating a price increase.

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Stock Forecasts

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Negative

Nvidia may face continued pressure from trade relations with China affecting their sales, especially given recent regulatory actions. However, given their aggressive strategies to adapt, including tailormaking chips for the Chinese market, their revenue could potentially stabilize or recover in the longer term. Still, immediate impacts from trade fears may keep the stock volatile.

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